Zainal Sapari: The Graduate Poor

This is a post by NTUC Assistant Secretary-General, Zainal Sapari. Any extracts should be attributed back to the author. 10 April 2018.

Degree? Check.

Skills? Check.

A proper job to match their qualifications? Unfortunately, not.

A recent survey conducted by the National University of Singapore’s Lee Kuan Yew School of Public Policy, in partnership with Ong Teng Cheong Labour Leadership Institute and presented to the Labour Research Conference in 2017, revealed worrying statistics of seriously underemployed Singaporean graduates. The survey – one of the first of its kind – revealed that a small group of graduates had fallen into involuntary underemployment (in other words, not by choice but by circumstances beyond their control) where despite working full-time, they earn less than $2,000 per month. These are the ‘graduate poor’ and it is a black swan in our labour landscape.

Based on a research sample of 1,626 Singapore workers, about 70 of them were considered severely underemployed. This group of underemployed were typically female (63 per cent) and of a median age of 35 years. A majority of them (61 per cent) also had no children. They had 10 to 15 years of working experience and were employed at businesses that serve mainly the domestic market. They also came largely from the health and social services sectors, followed by financial services, transport and education sectors.

Surprisingly, despite their prior working experience, only half of these underemployed graduates felt that their skills were being recognised at work. More than three-quarter acknowledged that their employers recognised their educational qualifications. Yet they were being grossly underpaid.

These facts may be appalling to us and not surprisingly, these underemployed graduates themselves lament being underpaid; having a lower status at work than what they think they should be having; possessing inadequate retirement savings; having little confidence in their income and job security; and in the more serious cases, even experiencing difficulties covering their daily expenses. The survey findings correspond with many other research studies done in this area in the USA, where there is clear evidence of underemployed graduates having lower self-esteem, greater stress and less job satisfaction.

Underemployed – by Choice or Circumstance?

How do people become, and get stuck being underemployed?

Sometimes, opportunities may have been scarce or may not have been spotted by these graduates. At other times, they may have been too quick to take up any job offer that came their way, to bring in an income to pay their bills and daily living expenses. This group may then find themselves stuck in that ‘lesser’ job role and may find it increasingly difficult to venture out after settling in.

Regardless of the reason, the underlying issue is that these graduates are not adequately paid. Being underemployed over a longer term can also lead to a vicious cycle because these workers may lose the drive and confidence to update their skills and remain relevant to the job that commensurate with their skills and qualifications. Over time, they may feel trapped in their current jobs and become increasingly pessimistic about being able to find anything better. This would make it difficult for them to break out of this trap unless they are retrained or reskilled.

To ignore this fact is to potentially leave them open for further exploitation which would only deepen their predicament. And research has shown that underemployment amongst graduates can be expected to have more adverse economic, social and psychological impact.

Looking at their woes from the outside, one can easily empathise with them. With their work experience and skills acquired throughout their working years, they could possess latent skills which have the potential to be harnessed and nurtured. All they need is a push in the right direction to help them rediscover these options and get back on track.

Targeted Approach to Help the Underemployed

Photo credit: iStock.com/wutwhanfotoThe underemployed surveyed, generally, experienced more health issues than others. This suggests that their underemployment could be a result of their inability to manage greater work demands due in part to poorer health.

The Government has introduced many programmes under the Adapt and Grow initiative to help mid-career professionals such as the Professional Conversion Programme to help professionals, managers and executives (PMEs) acquire new skills and move into new occupations with better prospects and progression. Workforce Singapore also runs the Career Support Programme which provides incentives to employers to hire experienced, mature PMEs, especially those who have been unemployed, by subsidising their salaries.

With all these programmes in place, the question is whether the underemployed graduates are aware of these schemes. Perhaps, a targeted approach is needed to help them. For a start, we need to find them, and provide career counselling to encourage them to look for jobs that better match their skills and qualifications.

The survey pointed out the need to identify the severely underemployed using multiple indicators and offer programmes that help these individuals cope with work and health issues, as the underemployed surveyed, generally, experienced more health issues than others. This suggests that their underemployment could be a result of their inability to manage greater work demands due in part to poorer health.

There is also a need to dispel the common perception that underemployed graduates are in such a predicament because of their poor attitude, which makes it difficult for them to secure suitable employment.

The study actually found that, barring health issues (which also happens to be more common amongst underemployed graduates), this group of underemployed graduates expressed the same willingness as their counterparts in the labour force (i.e. all other survey participants) to pick up new skills, reskill or deep-skill. They, therefore, have the drive to achieve a lot more in their careers (and earn higher salaries when they get there). The findings also revealed that they were more open to new experiences and are more conscientious at work as compared to their counterparts.

It also argued that individuals who are involuntarily underemployed deserve more help and resources, to enable them to benefit from a combination of purpose-driven upskilling with a clear target job, as well as life coaching. For employers, the study suggested the need for stronger recognition of skills and greater awareness on the areas to upskill. I concur with all the above statements – strongly, in fact.

As an economy powered by our people, we should assist this potential pool to level-up their employability. If health issues are the main contributing factor to their inability to carry out certain jobs, then employers should be encouraged to redesign these jobs. This is just one of the many ways we can help these underemployed graduates.

Safeguarding Against Underemployment

While the sample size in the study may be small, the findings give us insight into a problem that most of us believe a developed society like ours will not face. Whether these “graduate poor” are some of those who fell through the cracks or are victims of unfortunate circumstances, I think we need to always ensure that we keep an open mind. Earning less than $2,000 will put them below the 20th income percentile

It is one thing if you did not have access to good education, but to have access to it and not receive returns for it should be treated as a problem that is worth investigating.

If education is the ladder to social mobility, we need to find out exactly how it can grant people that mobility and ensure that nobody falls off the ladder completely.

In today’s job market, precarity can befall any of us. I think hardly anyone would suggest that those graduates who are underemployed are entirely to be blamed for it. Advancements in technology, artificial intelligence, even changing market preferences result in constant changes that threaten the future of work, and in turn, our rice bowls. This is an alarming reality facing every worker.

The key is to guard ourselves as much as we can. Keeping abreast of how jobs are changing and new jobs are being created under the Industry Transformation Maps (ITMs) is a good start and seizing the opportunities to reskill or upskill would steer us in a safe direction.

In addition, I hope the study serves as a good reminder to all – that sitting comfortably for too long with your current skillsets may potentially be “de-skilling” you, making you irrelevant for the needs of businesses in the future. That’s why the Labour Movement is always advocating for both employees and companies to think ahead and constantly plan for skills upgrading. A degree from even a top university cannot protect you if your skillsets have become irrelevant. Constantly re-learning and re-skilling are better insurance packages for job security.

For policy makers, it is important to keep track of this black swan. With university degrees under their belts, or even several years of service, nobody wishes to be employed full-time while earning less than they potentially could.

Graduate underemployment can become a newly emerging structural problem demanding structural solutions. While all the ITMs have been announced, we must make sure they work, and that their benefits are felt by workers.

Degree? Check.

Skills? Check.

Positive attitude towards work? Check.

Openness? Check.

Conscientiousness? Check.

Willingness to up-skill, re-skill, deep-skill? Triple check.

So, with the 23 ITMs being rolled out, surely they can (with targeted help) secure a job placement that allows them to reach their fullest potential.